Analyzing CTS (NYSE:CTS) & NeoMagic (OTCMKTS:NMGC)

NeoMagic (OTCMKTS:NMGC) and CTS (NYSE:CTS) are both technology companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, earnings, valuation and risk.

Profitability

This table compares NeoMagic and CTS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NeoMagic	N/A	N/A	N/A
CTS	12.37%	13.48%	9.62%

Valuation & Earnings

This table compares NeoMagic and CTS”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NeoMagic	N/A	N/A	N/A	N/A	N/A
CTS	$541.32 million	3.38	$65.32 million	$2.38	26.93

CTS has higher revenue and earnings than NeoMagic.

Analyst Ratings

This is a summary of recent ratings and price targets for NeoMagic and CTS, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NeoMagic	0	0	0	0	0.00
CTS	0	1	1	0	2.50

Institutional & Insider Ownership

96.9% of CTS shares are owned by institutional investors. 12.7% of NeoMagic shares are owned by company insiders. Comparatively, 2.4% of CTS shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

NeoMagic has a beta of -0.24, suggesting that its stock price is 124% less volatile than the S&P 500. Comparatively, CTS has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500.

Summary

CTS beats NeoMagic on 8 of the 9 factors compared between the two stocks.

About NeoMagic

NeoMagic Corporation designs and delivers semiconductors and software solutions for video, television, imaging, graphic, and audio devices. It offers microcontrollers; horizon digital picture frame and digital mobile TV solutions; and SOC processors, such as application processors and Neomobile TV solutions. The company, through its MercadoMagico.com division, operates an e-Commerce platform that allows user to buy and sell products from one another or buy premium electronic products. It sells its applications processors under the MiMagic brand name. The company was founded in 1993 and is based in Milpitas, California.

About CTS

CTS Corporation manufactures and sells sensors, actuators, and connectivity components in North America, Europe, and Asia. The company provides encoders, rotary position sensors, slide potentiometers, industrial and commercial rotary potentiometers. It also provides non-contacting, and contacting pedals; and eBrake pedals. In addition, the company offers flow meters, hydrophones, non-destructive testing, sonar, ultrasonic imaging, piezoelectric materials, piezoelectric sense products, and bulk products. Further, it provides eMobility, chassis, current sensors, clutch, brake, position sensors, stroke sensor, seating, speed, throttle, transmission, turbo, temperature sensors, and technical related products. Additionally, the company offers DIP, rotary selector, tactile, rotary DIP, and toggle switches, as well as provides transducer related products. Furthermore, it provides EMI, RFI, and RFI products; specialty and resistors; and frequency control products. The company sells and markets its products through its sales engineers, independent manufacturer representatives, and distributors. CTS Corporation was founded in 1896 and is based in Lisle, Illinois.